Indulge in Life in America

Paramount and Merrill Lynch made a good start, and this portfolio investment plan quickly became a popular practice in Hollywood.

Having tasted the sweetness, Merrill Lynch once again attacked and cooperated with comics giant Marvel to platter investment projects.

Later in the same year, Warner and Legendary Pictures also reached a similar agreement. The latter provided a total fund of US$500 million and planned to shoot 25 films in the next five years, each with 50% investment.

However, there are some differences between Warner and Legend’s cooperation with other platter investments. Legend is not like other fund investors who only raise funds and don’t care about anything else. It hopes to be deeply involved in the production and marketing of the film. Interested in the internal operation of the industry.

Most fund investors cannot choose the right to choose the titles in the platter, but the legend can, and there is a special screening power in the contract. In other words, it can reject the tasteless movies that Warner has brought over, and require Warner to reduce the risk and make money. Put the big oil and water items on the plate.

So to put it plainly, Legendary Pictures is essentially a private equity fund, but unlike ordinary funds, it is more interested in getting involved in the physical operation of the film industry.

A similar company is Sand Dune Entertainment. This company has signed 28 films and a total investment of 325 million US dollars with Twentieth Century Fox. After Warner split with Legendary Pictures, it joined hands with Dune Entertainment. Come.

Later, the well-known sub-prime mortgage crisis occurred. The global financial crisis led to a trough in the investment cooperation between 2007 and 2008. Some hedge funds withdrew from Hollywood and sold their projects to new players at discounted prices.

And many new players have begun to expand the direction of platter investment, not just investing in the production of films, but extending their tentacles to other corners of the entertainment industry. For example, some funds have begun to invest in the artist brokerage business, because they found that even large Celebrities, films starring in them may also fail at the box office, but no one has ever seen a star lose money. Isn’t it a more cost-effective business to invest in the star himself?

Recently, many funds outside Europe and the United States have also been gearing up to enter the Hollywood film industry, such as funds from India, the Middle East and Country Z.

In the final analysis, platter investment is a new means of financing the Hollywood film industry in the 21st century. Traditional film companies have obtained a large amount of external funds, shared risks, and firmly grasped the initiative of creation and the right to distribute overseas.

This approach essentially converts the stable income that can be expected in the future into a kind of securities to be sold to investors, because Hollywood film companies generally have consistent and excellent credit records, as well as strong IP monetization capabilities, for external investors , The risk can be controlled, and the return is considerable, so the thing is done.

Legendary Pictures is a master of the above gameplay. The history of this company is about how investment-based private equity funds are transformed into film companies engaged in film project development.

Then, would you not know such a huge pit?

Of course, it is impossible not to know. Investors with a little experience will understand that mergers and acquisitions are by no means as simple as buying. Healthy companies that maintain profit often prefer to develop independently and will not sell themselves. On the contrary, Those with the intention to be acquired are often companies that have poor management, heavy debt, or rigid management conflicts, and serious capital turnover problems.

In this way, the trouble is thrown to the acquirer, making the acquisition more like buying goods in the second-hand antiques market whose current assessed value is lower than the actual value. Buyers should not only consider which one to buy, but also buy it home. If you don’t match the decoration style at home, you must also consider how much you will buy and how to make money after you buy it.

Which one to buy, and does it conform to Wanjia’s decoration style?

When it comes to choosing which one to buy, Da Lao Wang’s thinking is very clear. His goal is obviously a global entertainment group at the Disney and Viacom level. Wanda will also completely transform from a real estate company to a service industry. Super giants have achieved a leading position in the pan-entertainment field.

The acquisition of AMC, the second largest theater in the United States, Hoyts, the second largest theater in Australia, and Odeon&UCI, the first theater in Europe, has a clear goal of becoming a world-wide theater operator.

To put it bluntly, I want to be the boss of the downstream cinema market. In this way, Wanda, which has the ability to distribute movies globally, will no longer be restricted by the major global cinema operators in the United States. Large film and television export lays the foundation for the world.

As a matter of course, the legendary film industry that created the "Batman" series, "Inception", "Jurassic World", "Pacific Rim", "World of Warcraft" and other Hollywood blockbusters was included under its command, making Wanda possess global distribution capabilities After that, they will be able to produce Hollywood-level blockbusters suitable for major markets.

A good example is that the box office of "Warcraft" was dismal after its release in North America last year, while the box office of Country Z has been soaring, eventually exceeding half of the total box office. This achievement is largely due to the good timing of the domestic film industry and World of Warcraft. Supported by a large number of players trained in China, such a blockbuster is not only a magical movie with Hollywood level, but also a nostalgic film that fits the feelings of the players in Country Z. Of course, there is no way for a bad reputation.

However, the strategic significance of the movie "Warcraft" has been produced, and such a positive impact is what Da Lao Wang hopes to see.

But then again, in recent years, Dao Wang has been spending money overseas. Whether it is the acquisition of AMC or the recent acquisition of Odeon&UCI, Wanda's acquisition has been full of twists and turns.

The acquisition of AMC, from the initial asking price of 1.5 billion U.S. dollars to the final transaction of 700 million U.S. dollars, Wanda spent several million U.S. dollars to hire a team, and it took several years to complete the acquisition.

The acquisition of Odeon&UCI, Europe’s largest cinema chain, was also due to the price issue. After that, thanks to the Brexit turmoil, the European economy was only successful under the premise of a downturn. The whole process lasted for three years. After many rounds of arduous negotiations, no agreement was reached due to price reasons, and the British "Brexit" storm brought new opportunities, and the two sides finally reached an agreement.

But the most important issue is here. Wanda’s layout intention is obvious, but all of the target companies they acquire have suffered heavy losses before, so the company can only be bought, and it has to find a way to turn losses into profits.

For theater chains, buying in the industry's downturn, cutting off other business sectors that are not profitable, and then companies can often reverse losses under the general trend of industry recovery.

AMC, which was in the trough of the American cinema industry in 12 years, lost 100 million yuan in the year before the acquisition, and had a debt of nearly 3.5 billion US dollars. Most of its losses were due to the bleakness of the American film industry at that time. At that time, AMC was a large-scale, operating company. Mature industry giants are short of heroes.

After Wan Da took over, just over a year, the output of the American film industry hit a new high, the stock market led, and the customer service level improved, the market value of AMC doubled, less than 800 million investment in exchange for nearly 1.7 billion market value .

This wave made Da Lao Wang and his Wan Da made a lot of money in the short term. In the long run, this acquisition is a good opportunity to enter the US market. AMC is even regarded as the export of Z culture to the United States. In addition, through AMC, Wanda was able to repeatedly acquire domestic film and television companies in the United States and successfully planted the flag in the United States.

I have to admit that this acquisition is three birds with one stone. It is admirable. The move of the king is really wonderful. For the acquisition of Odeon&UCI when the European economy is under the influence of Brexit, the discerning person will With a smile, this may be another outstanding investment case.

But in terms of the film industry, Yang Cheng is conservative about this investment in Legendary Pictures. Although Legendary Pictures has a large number of excellent IPs, while creating high-level movies, it can form a good interaction with Wanda's huge tourism ecological chain. , The film image promoted through Wanda’s huge offline business chain can not only penetrate the hearts of the people, but can even become a labelled image of Wanda’s culture. Once this effect is formed, the commercial value behind it is really huge.

In addition, the global distribution of theaters allows Wanda Manufacturing to effectively export. The US film market is highly competitive, but in Country Z, this is still a blue ocean.

Three Kingdoms theme, "Lord of the Rings" production level of ancient war film; Taoism and Buddhism theme, a magical film that blends the scenery of the country of Z; or a suspense film of "Inception" level in the contemporary metropolis background. . . Such works are undoubtedly a gluttonous meal for the country Z audience who have always hoped to have excellent domestic films. The huge country Z market driven by 1.4 billion people will create countless miracles.

As a result, the level of Legendary Pictures is far from enough. In the middle of last year, it was reported that Wanda intends to encroach on Paramount, one of the six giants. Once the news came out, there was an uproar in the United States. Could it be that the history of RB people's dominance of the United States will Did it happen again?

It was also at this time that UU Reading www.uukanshu.com Wanda, the super giant ship, successfully entered the sight of Americans. Before they knew it, this consortium from Country Z had already opened up the film industry. , Distribution, and screening have realized a complete industrial chain.

With the careful attention of Americans, will they let you continue to grow bigger?

In the middle of last year, the news came out that Wanda was negotiating with Paramount’s parent company Viacom. Wanda planned to purchase 49% of Paramount’s equity held by the latter. However, industry insiders know that it is difficult for both parties to negotiate. The price is agreed.

Because when Viacom hoped to conclude this transaction, it valued Paramount Pictures at between US$8 billion and US$10 billion. Later, there was news that the sale of Paramount was met by Viacom Holdings. The company's National Entertainment, and the strong opposition of the Redstone family, the owner of the company.

It even amended the company’s articles of association for this purpose, stipulating that any transaction must be approved by the board of directors, and the group owner Sam Redstone and his daughter Shali Redstone, who own 80% of Viacom Group’s controlling rights, are members of the board of directors. They all clearly opposed the sale of Paramount, believing that the sale of Paramount’s equity would harm the interests of shareholders. This also makes the prospect of Wanda acquiring Paramount's equity slim.

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